SECP Updates Approved Auditor Criteria for Financial Institutions

For context, the Securities and Exchange Commission of Pakistan (SECP) has revised the eligibility criteria for audit firms appointed by financial institutions and other regulated entities, introducing changes to its list of approved auditors.

Key points

• The revised framework covers entities regulated under various laws, including the Securities Act, 2015, the Futures Market Act, 2016, the Insurance Ordinance, 2000, and the Firms Act, 2017.
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• Insurance, reinsurance and takaful operators with total assets exceeding Rs10 billion, collateral management firms, credit rating businesses and professional clearing members are additionally covered.
• Asset management firms appointing auditors for collective investment schemes must additionally comply with SECP Direction No.
• Obtain the latest business news, market insights, and economic updates wherever you prefer.

For context, the commission issued Circular No. 24 of 2026, partially amending Circular No. 7 of 2026. The revised framework covers entities regulated under various laws, including the Securities Act, 2015, the Futures Market Act, 2016, the Insurance Ordinance, 2000, and the Firms Act, 2017.

According to the circular, the revised criteria will apply to the appointment of auditors by lending non banking finance firms (NBFCs) for financial years beginning on or after January 1, 2027.

In practice, the SECP has divided eligible audit firms into categories based on the nature of regulated entities, their licensing status and asset thresholds. Pakistan to Introduce New Law to Stop Cosmetics Smuggling. First Category Covers Larger Regulated Entities.

Audit firms in the first category can audit a broad range of regulated entities, including securities exchanges, futures exchanges, clearing houses, depository firms, securities brokers holding trading and clearing licenses, and asset management businesses or pension fund managers with assets under management of Rs50 billion or more.

For context, the category additionally includes lending NBFCs accepting deposits, non deposit taking lending NBFCs with assets of Rs1 billion or more, modarabas with assets of Rs1 billion or more, and collective investment schemes, voluntary pension schemes or real estate investment trusts (REITs) with assets of Rs10 billion or more.

Insurance, reinsurance and takaful operators with total assets exceeding Rs10 billion, collateral management firms, credit rating businesses and professional clearing members are additionally covered. PSX Confirms Full Refunds for SE Fruits IPO Investors.

For context, the approved audit firms in this category are A.F. Ferguson & Co., Baker Tilly Mehmood Idrees Qamar, BDO Ebrahim & Co., Crowe Hussain Chaudhury & Co., EY Ford Rhodes, Grant Thornton Anjum Rahman, Ilyas Saeed & Co., KPMG Taseer Hadi & Co., Kreston Hyder Bhimji & Co., Muniff Ziauddin & Co., Nasir Javaid Maqsood Imran, Parker Russell A.J.S., Rahman Sarfaraz Rahim Iqbal Rafiq, Reanda Haroon Zakaria Aamir Salman Rizwan & Co., Riaz Ahmad & Co., Rizwan & Co., RSM Awais Hyder Liaquat Nauman, S.M. Suhail & Co., Yousuf Adil and UHY Hassan Naeem & Co. Separate Category Covers Smaller Entities.

Notably, the SECP has established a separate category for smaller regulated entities, including securities brokers holding trading and self clearing licenses, asset management firms or pension fund managers and NBFCs with assets under management below Rs50 billion.

It additionally covers non deposit taking lending NBFCs with assets below Rs1 billion, modarabas with assets below Rs1 billion, collective investment schemes, voluntary pension schemes or REIT schemes with assets below Rs10 billion, and insurance, reinsurance or takaful operators with total assets of Rs10 billion or less.

Meanwhile, the approved firms in this category are Amin Mudassar & Co., Fazal Mahmood & Co., H.A.M.D & Co., Junaidy Shoaib Asad, Malik Haroon Ahmad & Co., Mushtaq & Co., Naveed Zafar Ashfaq Jaffery & Co., PKF F.R.A.N.T.S., Riaz Ahmad, Saqib, Gohar & Co., ShineWing Hameed Chaudhri & Co. And Tariq Abdul Ghani & Co.

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Entities in the trading only category of securities brokers, futures brokers of the Pakistan Mercantile Exchange, securities and futures advisers, modarabas with assets below Rs200 million, insurance and reinsurance brokers, third party administrators, corporate restructuring firms, trusts created by corporate restructuring businesses, share registrars and balloters may appoint any audit firm with a satisfactory quality control review rating from the Institute of Chartered Accountants of Pakistan.

For context, the SECP has additionally clarified that entities covered by the specified categories that qualify as public interest businesses under the Third Schedule to the Firms Act, 2017, must additionally appoint auditors registered with the Audit Oversight Board under Section 36K(a) of the SECP Act, 1997.

Asset management firms appointing auditors for collective investment schemes must additionally comply with SECP Direction No. 05, issued on February 23, 2026, and any subsequent directions issued by the commission. Stay Connected with ProPakistani.

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